Rain, Rain, Go Away -- Damages from Overflow of Clogged Roof Drain Found to be Covered

PROPERTY – EFFICIENT PROXIMATE CAUSE OF LOSS – ACCIDENTAL DISCHARGE OR OVERFLOW FROM WITHIN A PLUMBING SYSTEM
Potoff v. Chubb Indem. Ins. Co.
(Sup. Ct., New York Co., decided 5/23/2008)

Chubb insured Potoff's 4th floor co-oped apartment and studio under a named perils policy that covered damages resulting from, among other things, the "accidental discharge or overflow from within a plumbing ... system..." including "from water and water borne material which backs up from within sewers or drains."

After a heavy overnight rainstorm, rainwater collected on the roof and leaked into the apartments below through "various fissures in the roof". Firemen who had been dispatched to the building found and removed a plastic bag that had been clogging the roof drain, allowing 18 inches of standing water on the roof to drain.

Although Chubb did not dispute that the roof drain was a "plumbing sytem", it denied coverage based on its position that that the blockage of water in the roof drain did not cause an accidental discharge or overflow from within the drain and that, in any event, the proximate cause of Potoff's was the passage of water through the roof.

In denying Chubb's motion and granting the insured's cross motion for summary judgment, Justice Martin Shulman rejected Chubb's arument on causation, finding:

If the accumulation of water on the roof resulted from an accidental overflow from within the roof drain, then the fact that the water had to pass through the surface of the roof in order to damage plaintiffs property does not alter the fact that such damage was directly caused by the overflow. The roof, whether portions of it were weakened by the water or not, was merely the setting through which the water passed.

Noting that "[t]he issue here... is not what the efficient cause of Potoff's damages was, but whether the water that caused those damages was an accidental overflow from the subject drain", the court held:

The tests to be applied in construing an insurance policy are common speech and the reasonable expectation and purpose of the ordinary businessman." Ace Wire & Cable Co., Inc. v Aetna Cas. & Sur. Co., 60 NY2d 390, 398 (1983) (citations omitted). Under those tests, where water that normally would go down a drain is stopped from doing so by an obstruction in the drain, the resulting overflow is an overflow from within the plumbing system. It is undisputed that the plastic bag clogged the drain. Accordingly, some water entered the drain, then continuously overflowed once the drain's capacity was exceeded.

Partial summary judgment on liability granted to Pottoff, with the amount of damages to be determined at trial, if not resolved first in court-ordered mediation.

Post Script (March 13, 2009) ~~ The First Department AFFIRMED this decision here.